Ishrath Jaigirdar
Dubai, UAE
The GCC real estate sector is poised for accelerating growth in 2025, particularly in regional hotspots like the UAE and Saudi Arabia. The two economies have been driving momentum in the region, buoyed by large-scale infrastructure, enhanced living quality, as well as ease of property ownership regulations. Their real estate markets are experiencing demand growth and price rise due to the rising population into, experts say. Going forward, in 2025 GCC’s real estate sector will continue to see this trend given that mega projects are attracting more investments and people into the region.
Matthew Green, Head of Research at CBRE MENA, forecast sustained growth in GCC, especially in the UAE and Saudi Arabia. “Both governments [are] committed to significant investments to further bolster the business environment, including major infrastructure investments like the Dubai and Riyadh Metros, in addition to Saudi’s stadium preparation works for the 2034 World Cup tournament,” he told Gulf Property.
The UAE recorded stronger market performance in 2024, underpinned by high-profile launches and sell-outs as well as timely deliveries. It achieved Dh893 billion transactions across Dubai, Abu Dhabi, Sharjah, and Ajman last year. The country’s economic resilience, political stability, and capacity to seamlessly rebound from global crises, such as the pandemic, have made it an ideal destination for living. It was one of the few countries that first opened to international travel during Covid 19, welcoming visitors who later decided to reside here.
As a frontrunner in the region’s real estate and the UAE’s leading market, Dubai caters to a diverse range of investors with its varied residential supply. It has 1,190 projects under construction that will deliver 326,604 units. Currently, the market is seeing rise in transaction volumes, house prices, and population, especially those looking at Dubai as their second home.
“In the UAE, Dubai continues to be the star performing market where house prices were up about 20 percent last year. Presently we are about 14 percent above the last market peak form 2014. The market is experiencing increase in transaction volumes, house prices and population, which crossed 3.8 million last year, a 4.5 percent rise, which is putting pressure on the existing housing stock,” Faisal Durrani, Partner – Head of Research at Knight Frank MENA, said.
He further said that luxury property buyers are spending an equal amount in refurbishing homes, which indicates that these buyers are primary end users who will stay rather than sell them. As a consequence, the number of homes for sale in the market is experiencing a sharp drop. Notably, the availability of prime residences worth over US$10 million in Dubai has declined by 65 percent, causing developers to rush in to alleviate supply shortage.
In terms of development in 2025, areas like Dubai South and regions surrounding Dubai World Central are poised to be the future residential and commercial hubs in Dubai by the next decade. Rapid development is taking place to enhance accessibility and infrastructure. Investors are using this opportunity to buy spaces that promise high return on investment (ROI) in the long run. As per Faisal, potential buyers can anticipate a price hike of 8 percent in 2025
In global cities like Dubai and Abu Dhabi, the demand for professionally managed built-to-rent residences remains high. Homes that come with additional lifestyle facilities like gym, swimming pools, BBQ areas, retail options, and day-care are popular among expats or professionals relocating to these cities.
Milos Antić, Vice Chairman of DHG International Holding and CEO of DHG Properties Dubai, also remarked on the UAE’s real estate predicted performance, “The UAE’s real estate market is set for continued growth in 2025, driven by its status as a global trade and tourism hub, attracting both regional and international investors. Sustainability initiatives, aligned with global ESG priorities, are expected to further accelerate this momentum. Other key growth drivers include increasing retail activity and the expansion of mixed-use developments.”
Saudi Arabia is another pivotal cornerstone of the GCC real estate. Hotspots like Riyadh, the commercial capital, are seeing remarkable transformation to host international residents. Mega scale mixed-use projects like New Murabba and Diriyah Gate are key landmarks that highlight Vision 2030. The quality of projects, speed of activity, and interest from international and Saudi buyers is driving the market in the Kingdom, according to Knight Frank’s Head of Research.
Currently though, there is a shortage of professionally managed homes, specifically studios and one-bedroom apartments that will house digital nomads and smaller families. Developers need to build more spaces to accommodate such needs.
“Riyadh [is] seeing rising home prices and increased investment demand, at a retail and institutional level, with a growing number of global investment firms currently carrying out due diligence on the region for suitable entry opportunities,” Matthew added.
Qatar is another region that investors will observe this year. It continues to maintain sufficient supply of high quality homes that are more affordable than prominent cities like Dubai and exhibits signs of improvement.
Ends
Also read: UAE real estate records Dh893 bn transactions in four emirates
